Pound plunges the most in a year

The pound plunged to fresh monthly lows as Prime Minister Theresa May’s cabinet descended into chaos over a draft Brexit deal between the U.K. and the E.U. Meanwhile, U.S. retail sales were mixed and oil continued to rebound.

Mayday

After presenting a draft deal to her cabinet on Wednesday, PM Theresa May is facing increased criticism while members of her cabinet resign.

The deal, which allows for the exit of the U.K. from the E.U. on March 29, 2019, also keeps the U.K. in the E.U. trading bloc and under E.U. laws until the end of 2020.

Brexit Secretary Dominic Raab resigned Thursday, citing the indefinite backstop arrangement over the Northern Ireland border as the main reason, saying it threatens the integrity of the U.K. Raab’s resignation was joined by a few other ministers, including Work and Pensions Secretary Ester McVey.

MP Jacob Rees-Mogg has since written a letter calling for a confidence vote of May’s leadership. Although, he said he was not putting himself forward for the role. Others have also written letters.

The GBP/USD pair fell from near 1.302 at 6 a.m. London time to 1.276 around 10 a.m. the pair has been bouncing around this range since.

The EUR/USD pair also got pulled lower on the Brexit uncertainty, dropping from 1.134 to 1.128. It then rose to 1.130.

U.S. retail sales come out mixed

Retails sales in the U.S. for October missed expectations, allowing the euro to advance against the dollar Thursday morning.

The retail sales control group grew 0.3% instead of the 0.4% estimates. Retail sales excluding autos beat expectations of 0.5% growth MoM, coming out at 0.7%.

The retail sales for September were revised lower from 0.5% growth to 0.3%.

In other economic data, weekly jobless claims also missed expectations, coming out higher than estimated.

Oil continues to rebound

A barrel of West Texas Intermediate hit fresh yearly lows on Tuesday, but it’s slowly rebounding.

WTI is reaching $56.77 per barrel as the idea of Middle East oil producers cutting production gets some life. The lower oil prices for now are propping up the USD/CAD as the loonie gets pulled lower with oil.